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LEGAL CAVEAT
CLC Human Resources has worked to ensure the accuracy of the information it provides to its members. This report relies upon data obtained from many sources, however, and CLC
Human Resources cannot guarantee the accuracy of the information or its analysis in all cases. Furthermore, CLC Human Resources is not engaged in rendering legal, accounting, or other
professional services. Its reports should not be construed as professional advice on any particular set of facts or circumstances. Members requiring such services are advised to consult
an appropriate professional. Neither The Corporate Executive Board Company nor its programs are responsible for any claims or losses that may arise from a) any errors or omissions in
their reports, whether caused by CLC Human Resources or its sources, or b) reliance upon any recommendation made by CLC Human Resources.
3. 3
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UNPACKING SUCCESSION RISK
The Four Succession Risks
Portfolio Risk
Risk of poor
deployment of
talent against
business goals.
Supporting Organization-
Wide Objectives
4
Readiness Risk
Risk of
underdeveloped
successors.
Transition Risk
Risk of poor
assimilation
of executive
talent into the
organization.
Enabling High Performance
of Successors
32
Vacancy Risk
Risk of critical
leadership
positions being
vacant.
Fixing the Succession
Planning Process
1
4. 4
From CLC HUMAN RESOURCES
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Risks Vacancy Risk Readiness Risk Transition Risk Portfolio Risk
Risk Management
Imperatives
Safeguard Critical
Business Capabilities
Accelerate Full
Business Exposure
Overcome New
Hire Derailment
Maximize Strategic
Talent Leverage
FROM RISK TO OPPORTUNITY
Four Risks: Four Imperatives
5. 5
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HIGH-IMPACT SUCCESSION MANAGEMENT
From Succession Planning to Strategic Executive Talent Management
VACANCY RISK READINESS RISK TRANSITION RISK PORTFOLIO RISK
I
Safeguarding Critical
Business Capabilities
2
Accelerating
Full Business Exposure
3
Overcoming
New Hire Derailment
4
Maximizing Strategic Talent
Leverage
Translating Business Strategy
into Talent Strategy
Executive Talent
Growth Review
Providing Needed
Development Experiences
Experience-Based
Succession Management
Defining Needed
Behavior Changes
Executive Transition
Management
Organizing for High-Impact
Talent Utilization
Strategic Human
Capital Review
Planning for
Key Departures
Needs-Based
Succession Planning
Balancing Short-Term
Business Risk with Long-Term
Development Benefit
Non-Obvious
Development Moves
Onboarding for
Organizational Fit
New Executive
Career Launch
6. 6
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OVERLY DEMOCRATIC PROCESS, WASTED EFFORTS
Overall Comparison of Vacancy Risk
VP of R&D and CFO
Source: Corporate Leadership Council 2003 Succession Management Survey.
People and Positions Covered by Succession
Management Process1
Position A:
VP of R&D
Position B:
CFO
Urgency on
Time-to-Fill
High High
Overall Impact on
Business
High High
Scarcity of Skill Set
in the Labor Market
High Low
Short-Term Cost
of Vacancy
High Medium
Long-Term Cost
of Vacancy
High High
Vacancy Risk High Medium
93%
56%
41%
24%
13%
AllPositionsAbove
aCertainLevel
AllHigh-Potential
Employees
AllPositionswithSignificant
ImpactonBusiness
AllPositionsThat
RequireSpecializedSkills,
Abilities,orExpertise
AllPeopleorPositions
DifficulttoFindin
ExternalLaborMarket
n = 234.
1 Respondents could select multiple responses.
7. 7
From CLC HUMAN RESOURCES
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CORPORATE
LEADERSHIP
COUNCIL
CORPORATE EXECUTIVE BOARD
EXECUTIVE TALENT GROWTH REVIEW
OVERVIEW
Johnson & Johnson protects business-critical capabilities through developing a talent review methodology designed
to rigorously assess and plan for senior executive growth.
8. 8
From CLC HUMAN RESOURCES
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MIND THE TALENT GAP
Embed Talent
Growth
Imperative
Conduct Talent
Review “Roll-
Up” Strategy
Develop an
Aggregate
View of Growth
Assets
Strengthen
Quality of Talent
Review Dialogue
Commit to
Rigorous
Examination of
Talent Options
Drive to $80 Billion in Revenue
54321
Number of Senior Executives1
Revenue
1,000
500
0
Year 1 Year 3 Year 5
$100B
$60B
$20B
1 Actual numbers disguised.
9. 9
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FOUR LENSES ON EXECUTIVE CAPABILITY
Johnson & Johnson’s “Folio Map”
5
4
4
4
4
3
3
3
2
Keepers—Soundly performing
executives, whose potential
matches their level of accountability.
Movers: Blockers—Executives
can identify managers with low
results or potential “blocking” the
development of rising leaders.
Low
High
High
Low
Performance Results
THE FOUR LENSES
1. Potential
Assessment
2. Performance
Results
3. Position’s Level of
Accountability
4. People Development
Codes
5–Outstanding
4–Superior
3–Competent
2–Needs Improvement
1–Unacceptable
Size of
Circle
PotentialAssessment
Source: Fulmer, Robert, “Johnson Johnson: Frameworks for Leadership,” Organizational Dynamics, Vol. 29, no. 3, 2001.
Growers—Enables identification
of high-potential, high-results
executives in need of development
assignments.
Movers: Underperformers—
Employees needing reassignment
based on suboptimal performance
or people development histories.
10. 10
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■■ Time for independent thought—Reviewing executives are given time to consider talent independently before
discussion.
■■ Consistent standards for evaluation—Provides opportunity for executives to consider the entire slate of candidates
before beginning formal review, thus escaping “evolution of standards” as review progresses.
■■ Everyone can speak—Facilitator ensures that each executive with a comment on an individual has an opportunity to
voice that comment.
Executives spend
15 minutes evaluating
folio map with initial
talent evaluations…
…then “commit” to
voicing, in detail, any
thoughts or questions
concerning the ratings
by placing a sticky note
by specific ratings.
Results
Potential
Liz
■■ David
DECEPTIVELY SIMPLE
Steps of “Talent Scope” Calibration Exercise Output of Calibration Exercise
Benefits of Sticky Note Calibration
• Calvin
• Sapana
• Jeremy
• Linda
• David
• Judith
• Felix
• Homer
Jeff
Liz
Jeff
Jeff
Jan
• Anna
• Rob
• Tom
Low
High
High
Low
Performance Results
PotentialAssessment
Reviewing executives may flag talent
either to question or validate any
aspect of the managers’ ratings.
Jan
Liz
11. 11
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CORPORATE
LEADERSHIP
COUNCIL
CORPORATE EXECUTIVE BOARD
NEEDS-BASED SUCCESSION PLANNING
OVERVIEW
Duke Energy guides succession management efforts by focusing on key questions regarding executive talent supply
and demand.
12. 12
From CLC HUMAN RESOURCES
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Annual Succession Conferences
Do we have candidates
qualified to assume key
positions?
What are the ongoing
talent risks to the
organization?
What is the best way to
move talent in the event
of succession?
PLANNING BASED ON ORGANIZATIONAL PRIORITIES
2
43
What are the departure
risks we need to act on
now?
1
13. 13
From CLC HUMAN RESOURCES
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Retention Outlook
Low Medium High
Criticality
High
1% 16% 46%
Medium
2% 13% 19%
Low
1% 2% 1%
5 91 237
12 70 103
3 15 4
ASKING “WHAT” WON’T BE HERE NEXT YEAR?
Assessing Immediate Turnover Risk: Retention–Criticality Matrix1
Identify Capabilities at Risk
Executives can click on tabs within the matrix
to review at-risk talent and prepare specialized
retention strategies or plan for loss of talent.
Assess Retention Risks
■■ Total compensation
versus market
compensation
■■ Future career
opportunities within and
outside of Duke Energy
■■ Exposure to senior
managers and the
degree to which that
exposure has been
favorable
Focus on Critical Positions
By drawing out experience
and competency
requirements, position
profiles provide a means
to assess a position’s
criticality. More specifically
HR considers the following:
■■ High experience
or competence
requirements
■■ Degree to which critical
business processes
would stop if left vacant
■■ Barriers of entry to
position, stemming
from specialization
or educational
requirements
■■ Position’s impact on
customers, revenue, or
productivity
1 All examples are hypothetical.
14. 14
From CLC HUMAN RESOURCES
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1 All examples are hypothetical.
FOCUSING MANAGERS ON FIT
HR Successor Slate Evaluation
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HR compares
position-specific
criteria against
the qualifications
of identified
successors (e.g.,
competencies,
work experiences)
to determine a
candidate’s “fit”
with the position.
Candidates from both
lists are considered in
all talent reviews.
HR runs query for
alternate qualified
successors based on
position profile.
HR analyzes “fit” of
designated successors
for position.
Managers submit
list of successors for
designated positions.
Manager
Nominations for VP
Strategic Planning
1. Lars Ulrich
2. Eric Weiss
3. Janet Bell
Successor List, VP
Strategic Planning
1. J. Bell 93%
2. L. Ulrich 90%
3. I. Smith 85%
4. E. Weiss 65%
Successor Ratio = 4:1
Successor Bench Strength Analysis1
Name Fit
1. L. Ulrich 90%
2. E. Weiss 65%
3. J. Bell 93%
Name Fit
1. I. Smith 85%
2. M. Hart 62%
3. S. Reid 57%
4. W. Key 49%
4321
24. 15
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1 All examples are hypothetical.
MUSICAL CHAIRS
Evaluation of Chain of Moves1
Potential Successor Availability? Successor Ratio Successors Position Fit Move?
Janet Bell
Assumed current role six months
ago; currently well placed (!)
1:1 (!) David 93%
Lars Ulrich
Within three months; finishing
current assignment
3:1
Thomas; Lynne;
Seàmus
90%
Isabella Smith
One year or more (!);
engaged in critical assignment
0:1 (!) (None) 85%
Eric Weiss Immediate availability 2:1 Sylvia; Alberto 65% (!)
Successor List,
VP Strategic Planning
1. J. Bell 93%
2. L. Ulrich 90%
3. I. Smith 85%
4. E. Weiss 65%
Succession Risks
D. Roth
VP, Strategic Planning
J. Bell
First-Level
Risk
Second-Level
Risk
Manager Availability
Managers may be engaged
in critical assignments or
be well placed and not in
need of a new assignment.
Successor Ratios
Insufficient ratio of successors
requires close examination of
the risks of moving managers
out of their current roles.
Quantified “Stretch Risk”
Position fit, by showing the skill gap the
candidate will need to overcome if selected,
also gives an indication of the “stretch risk”
from placing a manager in a position.
25. 16
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VACANCY RISK READINESS RISK TRANSITION RISK PORTFOLIO RISK
I
Safeguarding Critical
Business Capabilities
2
Accelerating
Full Business Exposure
3
Overcoming
New Hire Derailment
4
Maximizing Strategic Talent
Leverage
Translating Business Strategy
into Talent Strategy
Executive Talent
Growth Review
Providing Needed
Development Experiences
Experience-Based
Succession Management
Defining Needed
Behavior Changes
Executive Transition
Management
Organizing for High-Impact
Talent Utilization
Strategic Human
Capital Review
Planning for
Key Departures
Needs-Based
Succession Planning
Balancing Short-Term
Business Risk with Long-Term
Development Benefit
Non-Obvious
Development Moves
Onboarding for
Organizational Fit
New Executive
Career Launch
HIGH-IMPACT SUCCESSION MANAGEMENT
From Succession Planning to Strategic Executive Talent Management
26. 17
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CORPORATE
LEADERSHIP
COUNCIL
CORPORATE EXECUTIVE BOARD
EXPERIENCE-BASED SUCCESSION MANAGEMENT
OVERVIEW
IBM improves its executive development by using its succession management system to ensure more effective
matching of development experiences to executives.
27. 18
From CLC HUMAN RESOURCES
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Annual Executive
Resources Discussion
Experience-Based
Development Models
Development-Based
Succession Plans
Executive Talent
Management System
Executive
Assignment
“Five-Minute Drills”
Ongoing Experience-
Based Coaching and
Consulting
ExecutiveCoach
Support from the GEOC—To support the integration of succession
planning and executive development, IBM creates a corporate
Global Executive and Organizational Capability (GEOC) department
integrating experts in succession planning, leadership consulting,
and executive coaching, who serve as consultants to the line.
Executive
Coaching/
Consulting
Executive
Development
Succession
Planning
VP, GEOC
VP of Talent
SVP of HR
Executive Leadership
Competencies
Derailment Factors
Long-Term Development
Plan
Ultimate Potential
Business Results
AN INTEGRATED EXPERIENTIAL DEVELOPMENT SYSTEM
6
5
4321
GEOC Support Staff Profile
• Senior HR professional
• 5–10 years experience with executive coaching and consulting
General
Managers
Business
Value
Selling
Country
GM
Technical
GM
Moves to Position
Position
From
Current
Job
One Job
Away
Two Jobs
Away
VP,
Storage
Solutions
• E. Johnson
• L. Hasega
• R. Lizardi
• J. Hansen • J. Ross
• C. Norbin
28. 19
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DIFFERENT ENDS, DIFFERENT MEANS
IBM Career Development Models
Sample Country GM
Development Model
Experiences
■■ Country knowledge
■■ Government/
political interface
Sample Technical GM
Development Model
Experiences
■■ Technical/
development
experience
■■ Manufacturing
experience
■■ Technical
systemwide view
Integrate Experiences with Competencies
To create a single, cohesive development system, the GEOC team clarifies how each
experience relates to the company’s executive leadership competency model.
General
Managers
Business
Value
Selling
Country GM
Technical
GM
2
Identify Senior Leadership
Roles
• Senior roles with
significant breadth and
business impact
• Roles for which internal
successors are critical
• Differentiated by unique,
critical skill requirements
1
Identify Development
Experiences
The GEOC interviews both
successful and average
executives to identify
critical experiences for
success in each senior
leadership role.
3
Sample General
Manager
Development Model
Experiences
■■ High-stakes
assignments
■■ Handling external
pressure
Sample Business
Value Selling
Development Model
Experiences
■■ Industry experience
■■ Services experience
■■ Software
experience
29. 20
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Moves to Position
Position
From Current
Job
One Job
Away
Two Jobs
Away
VP, Storage
Solutions
■■ E. Johnson
■■ L. Hasega
■■ R. Lizardi
■■ J. Hansen ■■ J. Ross
■■ C. Norbin
TARGETING DEVELOPMENT NOT REPLACEMENT NEEDS
Succession Planning Chart
Source: “How No. I Big Blue Builds Leaders,” Chief Executive Vol. 179 (June 2002).
Development
Needs
Experience Required
Cross-Border
Partnerships
Global Project
Development Team
Team Leadership Leadership Role in
10–50 Person Unit
Ability to Build
Relationships
Cross-Cultural Role
Possible Next Jobs:
■■ VP, European e-Business Integration Team
■■ VP, Asia Data Services
Talent
Profile
Development Needs Lenses Executive Development Plan
Experiences
Competencies
Derailment Factors
Potential Successor
Shortlist
When the position
becomes vacant,
people on this list will
be evaluated for their
readiness to assume
the role.
Vitality of Bench
Enables an assessment of the breadth
of bench and the depth of the talent
supply available to fill a position.
Shifted Burden for
Development
The focus on needed jobs
creates a need to ask “what
experiences do we need
to deliver to this person
for them to develop and
to prepare them for their
ultimate position?”
3
2
1
30. 21
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MAKING THE TOUGH CALLS
Chairman’s “Five-Minute Drill” Rules
■■ Senior talent viewed as corporate, not business unit, assets
■■ Everyone is fair game—no hoarding of talent
■■ The group approves all moves for the top 300 positions
■■ All decisions are made by consensus
■■ Focus is on the capability of individuals to drive results
SVP,
Server
Group
CFO
Chairman
SVP, Software
Group
SVP of
HR
Five-Minute Drill Agenda
August 4, 2003
1. Recap last month’s moves
2. Discuss and approve appointments to known
opportunities and new positions in the top
300 positions
Position
Prioritized List
of Candidates
Others Candidates
Considered
VP,
Storage
Solutions
1. Rafael
Lizardi
2. Ashley
Gigandet
3. Lisa
Hasegawa
■■ Lisa Screeton—
insufficient time in
current role
■■ Kenny Baer—vital in
current position
3. Identify development jobs for key talent
Person
Projected
Rotation Date
Desired Development
Experience
Joe Ross Q1, 2004
Needs PL responsibility
and exposure to
complex financial
challenge
Chairman’s “Five-Minute Drill”
Forcing the Hard Discussions
The Chairman’s expectations are designed to ensure
a candid debate about the short- and long-term
costs and benefits for each executive move.
Benefits Considered:
• Network building
• Best-practice sharing
• Innovation
Costs Considered:
• Temporary
performance drop
• Executive burnout
Full Slate
Transparency
A list of other
candidates
considered but not
selected is included
to demonstrate that
there can be no
hoarding.
Executive Talent Profile
The group reviews the
executive’s talent profile and
development plan to discuss
development areas and
possible assignments.
Development Model
Experience
Competency
Score
31. 22
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CORPORATE
LEADERSHIP
COUNCIL
CORPORATE EXECUTIVE BOARD
NON-OBVIOUS DEVELOPMENT MOVES
OVERVIEW
As part of the succession planning process Schlumberger identifies “non-obvious” cross-business development move
opportunities for a selected group of rising high-performing leaders.
32. 23
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Promote and Identify
Non-Obvious Development
Move Opportunities
Balance Long-Term
and Short‑Term
Benefits and Risks
(NON) OBVIOUS DEVELOPMENT BENEFITS
Potential Gains from Non-Obvious Development Moves
Total $
Increased
HIPO
Retention
Improved
Performance
Transfer of
Best
Practices
Realization of
New Cross-
Business
Opportunities
TotalDollarValue
Analyze “Stretch Errors” to
Improve Future Risk Taking
Support Individuals
in Non‑Obvious
Development Moves
Identify HIPO Successors
Early in Their Careers
5
4
321
33. 24
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STARTING EARLY
Schlumberger’s HIPO Reservoir
HIPO Reservoir
9 Percent of Exempt
Population (4,300 in 2002)
Schlumberger, Ltd.
78,500 employees
Annual HIPO Identification Process
■■ Minimum three years tenure
■■ High performer
■■ High potential
Global Talent Pool (50 Percent)
Talent Profile Name: Eva Vasquéz
Position: Integrated
Project Management
Location: Jakarta,
Indonesia
■■ 68 percent under age 35
■■ Entry-level to senior executive–level
staff
■■ Global development move every
2–3 years
Development
Strategy
Candidates for Non-Obvious
Development Moves
Expert Talent Pool (50 Percent)
Name: Larry Roth
Position: Geophysicist,
Oil Field Services
Location: Paris, France
■■ Hard-to-get functional skills
■■ Premier expert in function
■■ High tenure within one function
Functional Expert Path
34. 25
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GOING AGAINST GUT FEEL
Development Move Risk–Return Analysis
Succession Plan, Oil Field Services
Non-Obvious Move
Discussion Items
■■ Non-obvious move
opportunities for
“ready in the future”
candidates
■■ Business benefits
■■ Business risks
■■ Chain of moves
CEO EVP
VP of HR
Low Medium High
Low
High
Medium
Long-TermBusinessBenefit
Short-Term Business Risk
Obvious Moves
■■ Direct vertical move
within same function
■■ Move of “ready
now” successor into
business-troubled
position
■■ Move into a role with
limited development
benefit
Non-Obvious Moves
■■ Cross-business or
cross-geography move
■■ Developmental stretch move
■■ Manageable risk to business
Excessive Risk Moves
■■ Cross-business move
into business-challenged
position
■■ Developmental
“over-stretch” move
■■ Excessive, non-manageable
risk to business
“Ready in the Future”
Successor Characteristics
■■ Have been identified as
high-potential
■■ Are considered for “non-
obvious” move opportunities
when vacancies appear in
other BUs
■■ Are lacking experience
and exposure in function
or businessrisk to business
Position “Ready Now” “Ready in the
Future”
VP,
Drilling and
Measurement
Director, Drilling and
Measurement, Ann King
Recruiter,
Drilling and
Measurement,
France, Young
Lee
Manager,
Drilling and
Measurement,
Africa, Lisa Gil
Manager,
Seismic, U.S.,
Tom Smith
35. 26
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BUILDING A SAFETY NET
HR’s Individual Risk Evaluation
Team Strength Risk Mitigation
Position-Based Risk Assessment
Potential Risk Factors
■■ Avoids conflict
■■ Micromanagement
tendency
■■ Weak communicator
Hire
Assessment
Performance
Assessment
Profiles of
Past Moves
Profiles of
Individual
Constraints
1. Strengthen
Direct Reports
3. Use Internal
Training and
Coaching
2. Delegate
High-Risk
Responsibilities
Hiring
Manager
Past Position
Holder
A World Within
Past Holders of Position
Name
Current
Position
Telephone
Extension
Rob Crist SVP, Sales x4567
Jan Miller Director… x4123
Matt Reif Manager… x4890
36. 27
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VACANCY RISK READINESS RISK TRANSITION RISK PORTFOLIO RISK
I
Safeguarding Critical
Business Capabilities
2
Accelerating
Full Business Exposure
3
Overcoming
New Hire Derailment
4
Maximizing Strategic Talent
Leverage
Translating Business Strategy
into Talent Strategy
Executive Talent
Growth Review
Providing Needed
Development Experiences
Experience-Based
Succession Management
Defining Needed
Behavior Changes
Executive Transition
Management
Organizing for High-Impact
Talent Utilization
Strategic Human
Capital Review
Planning for
Key Departures
Needs-Based
Succession Planning
Balancing Short-Term
Business Risk with Long-Term
Development Benefit
Non-Obvious
Development Moves
Onboarding for
Organizational Fit
New Executive
Career Launch
HIGH-IMPACT SUCCESSION MANAGEMENT
From Succession Planning to Strategic Executive Talent Management
37. 28
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LOW SUCCESS RATES
Internally and Externally Hired CFOs Promoted to CEO, President,
or COO Roles
Failure of External Candidates
40%
Failed Within
18 Months
60%
Successful
in Role
Internal Hires External Hires
31
11
n = 200.
38. 29
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CORPORATE
LEADERSHIP
COUNCIL
CORPORATE EXECUTIVE BOARD
NEW EXECUTIVE CAREER LAUNCH
OVERVIEW
Beginning in 2001 American Express launched a suite of initiatives to overcome the problem of early external hire
departure, in particular the company focused on three key components of the onboarding process.
39. 30
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AVOIDING NEW HIRE STALL POINTS
Key Elements of New Executive Career Launch
■■ Uses onboarding interventions
to proactively manage new hire
expectations across the first year.
■■ Overcomes performance-
damaging peaks and troughs
in attitude toward the new role.
■■ Focuses the individual on long-
term development and uses
coaching to overcome potential
early derailers.
■■ Communicates acceptance of
development needs and ensures
that the new hire understands
the organization’s long-term
commitment to them.
■■ Goes beyond exposing individuals
to critical stakeholders to fostering
meaningful relationships.
■■ Provides new hires the networks
they need to succeed in company
consensus–driven culture.
Managing the
Expectation–Reality Gap
1
12 Months4–7 Months1 Month
NewHire
Perception
ofNewRole
Highly
Pessimistic
Highly
Optimistic
Initiating Development
at the Point of Hire
2
Build Key Relationships
for New Executives
3
40. 31
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“THE EXPECTATION–REALITY ROLLER COASTER”
Change in New Executive Hire Attitude Toward Company
First Year of Employment
Highly
Optimistic
Highly
Pessimistic
NewHirePerception
ofOrganization
1 Month 12 Months4–7 Months
Typical New Hire Experience
Desired New Hire Experience
High Potential for Performance Errors
“Reality Check”
Managing Down Expectations
■■ No “Duty Free” Onboarding
■■ Immediate Development
Requirements
“These Things Take Time”
Managing up Expectations
■■ 360-Degree Feedback
■■ Feedback in Context
“We’re Betting on You”
Ongoing Solutions for Success
■■ A New Plan
■■ Emphasis on Organizational
Commitment
41. 32
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AN IMMEDIATE FOCUS ON LONG-TERM DEVELOPMENT
American Express Parallel Development Focus
Early Focus
on Long-Term
Development
Leader
Benchmarking
From Assessment
to Development
Long-Term IDP
Within 30 Days
Individual Development Plan
Goal One: Manage cross-
functional reorganization
Goal Two: Work toward
AEXP “innovation” leadership
standard
Parallel
Focus
on Role-
Based
Learning
On-Call Assimilation Assistant
■■ HR provides an assistant to serve as
“on-call” support to answer simple
orientation questions for the new hire.
■■ Because the assistant is outside
the business unit, there is no stigma
associated with asking “basic” questions.
100–Day Organizational Learning Plan
■■ HR provides a templated “First 100 Days” plan that
covers all major “exposure” points an individual
needs to master the role.
■■ Plan provides step-by-step series of checklists,
contacts, and activities to follow.
Point
of Hire
External Assessment
© 2001 Corporate Executive Board
Catalyst
Adaptor
Orchestrator
CultivatorRelationship
Builder
Visionary
Goal
Driver
Step #4: Evaluate Rising Leaders’ Scores Against Top Executive Norms
Story Behind the Numbers
Pre-Executives’ Scores Are Summed and Analyzed Against Norms
Spider Graph Comparison*Pre-Executive Scorecard*
* Corporate Leadership Council illustrative.
3.5
Source: GE Medical Systems; Corporate Leadership Council research.
7.0
18b
0.0
Leadership Development
Needs of Bob Oliver
(in order of priority)
• Relationship Builder
• Visionary
• Cultivator
Bob Oliver’s Scores
Average Scores of Top Executives
Catalyst 7 6.2
Adaptor 6 6.5
Orchestrator 5 5.3
Cultivator 6 6.6
Relationship Builder 5 5.7
Visionary 5 5.6
Goal Driver 7 6.6
Category
Individual
Category
Score
Top
Executive
Norm
Scores
Name:Bob Oliver
Development
Needs Assessment*
“Norm” scores are
derived from average
scores of current top
executive responses.
New Hire Manager
Pre Hire
Immediate
Orientation
Early
Development
Planning
42. 33
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MORE THAN JUST MEET AND GREET
Three Levels of Relationship Building
I
Pre-Booked
Calendar of Meetings
2
Perspective Exchange
Opportunities
3
Cross-Business
Networking
CRITICAL ELEMENTS ENCOURAGING NETWORK DEVELOPMENT
Instilling a Sense of Contribution Tapping for New Ideas Building Cohorts
Meeting with the CEO New Hire Perspective Forum Annual New Leader Summit
Gaining Multiple Views
of the Organization
Meeting Customers
43. 34
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VACANCY RISK READINESS RISK TRANSITION RISK PORTFOLIO RISK
I
Safeguarding Critical
Business Capabilities
2
Accelerating
Full Business Exposure
3
Overcoming
New Hire Derailment
4
Maximizing Strategic Talent
Leverage
Translating Business Strategy
into Talent Strategy
Executive Talent
Growth Review
Providing Needed
Development Experiences
Experience-Based
Succession Management
Defining Needed
Behavior Changes
Executive Transition
Management
Organizing for High-Impact
Talent Utilization
Strategic Human
Capital Review
Planning for
Key Departures
Needs-Based
Succession Planning
Balancing Short-Term
Business Risk with Long-Term
Development Benefit
Non-Obvious
Development Moves
Onboarding for
Organizational Fit
New Executive
Career Launch
HIGH-IMPACT SUCCESSION MANAGEMENT
From Succession Planning to Strategic Executive Talent Management
44. 35
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WRONG PLACE, WRONG TIME, WRONG JOB
“Untapped Opportunity?”
Asking Too Much?
33%
15%
PointofOptimumLeverage
49%
Meeting Business
Objectives
51%
Not Meeting
Business Objectives
1 From “War for Talent,” The McKinsey Quarterly (3 November 1998): 44–57.
Percentage of Leaders Not Meeting Business ObjectivesExecutive Leverage1
45. 36
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CORPORATE
LEADERSHIP
COUNCIL
CORPORATE EXECUTIVE BOARD
STRATEGIC HUMAN CAPITAL REVIEW
OVERVIEW
Marriott’s HR department creates a succession management system that provides line managers the tools, skills,
and impetus to ensure continuous alignment of talent and organizational capabilities with business priorities.
46. 37
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THINKING OUTSIDE OF THE BOX
Expand Scope of the
Succession Management
Process to Include
Organizational Capability
1
Ensure Accountability
for Driving Talent—
Organization Alignment
4
Enhance Talent
Assessment Criteria
2
Enable Business Unit
Talent—Organization
Alignment
5
Enable Business
Unit Evaluation of
Organizational Design
and Talent Implications
3
Rating
Organizational Capability Focus Area E F C I
Organization Design/Organizational
Structure Design q q q q
Organization Design/Process Design q q q q
Organization Design/Job Design q q q q
Business/Culture Alignment q q q q
Performance Management System and
Measurement Frameworks q q q q
Change and Learning Management q q q q
Project Plan
Enablers of Change
❏ Purpose and goal explained
❏ New department mission clear
❏ Training in place to support
group
Talent
Management
Organizational
Capability
Business
Priorities
47. 38
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Have we established the right
organizational circumstances
to get maximum ROI from our
talent?
Areas Reviewed
■■ Organizational Design
(Structure, Process, and Job)
■■ Business Culture Alignment
■■ Change and Learning
Management
■■ Performance Measurement
Systems
EVP,
BU
THE THIRD LEG OF THE STOOL
Marriott’s Human Capital Review
Annual meetings are held between the president/COO
and each business unit EVP to discuss in depth the
unit’s talent health, organizational structure, and needs.
Are we attracting, developing, and
retaining the best industry talent?
Areas Reviewed
■■ Talent Acquisition
■■ Performance Development
■■ Total Compensation
■■ Work Environment
■■ Retention Management
Human Capital
Review
■ Executive and Key Talent Review
■ Leadership Continuity Planning
■ Organizational Capability
Assessment
Key Questions Addressed
SVP
HR, BU
President/
COO EVP,
HR
SVP, TM
OC
Business
Priorities
Talent
Management
Organizational
Capability
48. 39
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Rating
Organizational Capability Focus Area Exceptional Full Contributing Inhibiting
Organization Design/Organizational Structure Design:
Leadership structured to provide/execute decision making at right level. Resources organized effectively and efficiently; span
of control provides desired results. Virtual teams, task forces utilized to appropriate degree and enable cross-functional work to
be successfully performed. Organization effectively responds to external challenges and work requests in a timely manner with
appropriate quality/value. All key positions and reporting relationships exist to accomplish work from strategy to execution/
evaluation.
Organization Design/Process Design:
Right results are achieved at right time. Accountability is consistently clear, and high quality decisions are consistently made on time.
Intended outcomes/outputs achieved within desired/required time frame and budget. Common approach is used to perform core,
repetitive work. Work flows effectively, the number of hand-offs is as minimal as possible.
Organization Design/Job Design:
Senior positions designed with clear roles/responsibilities. Jobs are appropriate to senior talent sufficient autonomy; necessary
interdependence without overlap). Positions are appropriately sized to be realistic. Jobs are designed to include career
development/progression/ broadening. Job design promotes retention. Measurement criteria exists and utilized to judge
performance results.
Business/Culture Alignment:
Strategy, leadership impact, decision making style, communications are aligned to foster/sustain the overall Marriott International
culture and unique subculture/climate necessary to a specific unit to achieve business goals and work priorities. Senior leadership
behavior congruent with desired values/culture. Results are appropriately balanced with how results are accomplished. Distinct
approaches/environment exists to achieve/sustain a competitive advantage. Ability to respond to adverse situations quickly/
effectively while maintaining values.
Performance Management System and Measurement Frameworks:
Interactive and systematic ways are used to assess impact the leadership team has on core objectives, and key operating results
achieved by the organization, groups and teams. Evaluation criteria includes “return on investment” (benefit gained against invested
resources, etc.); “leading” and “lagging” indicators are in use. Goals (what is to be achieved) and boundaries (what is to be avoided)
are clearly delineated.
Change and Learning Management:
Ability of leadership to effectively, quickly and easily introduce and manage [major] change; necessary changes implemented and
adopted by associates as intended. Change is sustained. Infrastructure for learning and knowledge transfer in place; benefits from
learning and experience are institutionalized and internalized throughout organization. Consistent rewards/recognition for re-using/
enhancing as opposed to creating new.
A DETAILED LOOK AT THE ORGANIZATION
Organizational Capability Review (OCR) Tool
Targeted
questions
help focus
managers’
attention
on key
organizational
design
and talent
utilization
questions.
Additional
questions
encourage
managers to
think broadly
about the
overall talent
environment.
Rating Criteria
Exceptional—Strong facilitator of goals; source of competitive advantage
Full—Strong performance but enhancement possible
Contributing—Adequate performance but enhancement necessary
Inhibiting—Performance below expectations; major realignment needed
49. 40
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OCR Standard and Investigating Questions Areas of Talent Misalignment Identified Opportunities
Jobs are designed to include career development/
progression/broadening
■■ Are there multiple feeder positions for each job?
■■ Is there any job that is so customized that a single
successor is not possible?
Role change and customization
has led to gaps in the development
ladder
Identify and validate career
pipelines for this and
related positions
Job design promotes retention
■■ Are there positions which have historically high turnover?
■■ Does analysis of the job turnover point to an
organizational rather than individual cause?
Growth in role complexity has
resulted in some “impossible” jobs
Identify and restructure
problematic roles
Leadership structured to provide/execute decision making
at the right level
■■ Are individual executives frustrated with their levels of
autonomy?
■■ Are high-risk decisions being made with appropriate
oversight?
Static role definitions leave
approval authority too centralized
Redistribute executive
responsibilities to provide
appropriate authority and
development “stretch”
Jobs are appropriate to senior talent
■■ Are the skills of executives being fully leveraged in their
current positions?
■■ Are some executives holding responsibilities that others
could do better in or develop more from?
Jobs are not sufficiently
customized to fully leverage
individual skill sets
Consider areas where job
responsibilities could be
shifted to fully leverage
available talent
UNCOVERING OPPORTUNITIES FOR IMPROVEMENT
50. 41
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1 Proactively Assess Talent
and Organizational
Capability
Business unit head and SVP
of HR discuss talent and
organizational implications
of new business priorities or
strategy shift.
2 Identify Key Performance
Levers
LTDI and OCR used to
surface opportunities for
improvement.
3 Recommend and Select
Intervention Option
Business unit leaders
work with OC specialist to
develop and select options
for intervention.
4 Design, Develop, and
Implement Change
OC specialist partners with
business unit head and
senior HR generalist to carry
out change.
5 Evaluate Results
The team assesses the
implementation and
establishes metrics to
ensure sustained realization
of benefits.
HR Center of Expertise for Talent Management and
Organizational Capability, Organizational Capability Department
■■ Staff with expertise in organizational design, change
management, and performance management systems.
■■ Led by a VP of Organizational Capability who reports to the
SVP of Talent Management and Organizational Capability.
■■ Consult with business units to increase organizational
effectiveness.
Recent Organizational Capability Engagements
■■ Merging departments (e.g., currently integrating a large
corporate division and a lodging division into a single
organization)
■■ Building cross-organizational business processes (e.g., end-to-
end work flow of the hotel development process)
■■ Creating new departments
■■ Re-allocating job accountabilities
TURNING THE SHIP (ON A DIME)
Hypothetical Example of an Organizational Capability (OC) Engagement
51. 42
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Succession
Risks
Imperatives
for All
Organizations
MANAGING SUCCESSION RISKS: A FOUR-PART ACTION PLAN
Portfolio RiskTransition RiskReadiness RiskVacancy Risk
Imperative #4:
Maximize Strategic
Talent Leverage
Imperative #3:
Overcome New
Hire Derailment
Imperative #2:
Accelerate Full
Business Exposure
Imperative #1:
Safeguard Critical
Business Capabilities
52. 43
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Succession
Planning
Reactive
Process
Management
of Individual
Departure
Events
HIGH-IMPACT SUCCESSION MANAGEMENT
Vacancy Risk Readiness Risk Transition Risk Portfolio Risk
I
Safeguarding Critical
Business Capabilities
2
Accelerating
Full Business Exposure
3
Overcoming
New Hire Derailment
4
Maximizing Strategic
Talent Leverage
Translating Business
Strategy into Talent Strategy
Executive Talent
Growth Review
Providing Needed
Development Experiences
Experience-Based
Succession Management
Defining Needed
Behavior Changes
Executive Transition
Management
Organizing for High-Impact
Talent Utilization
Strategic Human
Capital Review
Planning for
Key Departures
Needs-Based
Succession Planning
Balancing Short-Term
Business Risk with Long-
Term Development Benefit
Non-Obvious
Development Moves
Onboarding for
Organizational Fit
New Executive
Career Launch
Strategic
Executive
Talent
Management
Proactive
Strategic
Management
of Talent
Portfolio in
Support of
Business Goals